Looking for home builders

A local non-profit is looking for people who may qualify for a federal sweat-equity housing program that offers low-interest loans for low-income applicants willing to build their own homes.

"We need more applicants," said Brad McDonald, home ownership manager with Rural Communities Housing Development Corporation. "We are here to work with people through the process and do whatever it takes to help fulfill their dream of home ownership."

Like most realtors, RCHDC has been seeing a decline in the numbers of people willing to own a home lately, starting with the downturn of the economy in 2007.

The fact that the program wasn't well publicized didn't help, according to McDonald. Neither did the fact that finding applicants was already difficult because of the requirements an applicant has to meet to qualify for a loan from the U.S. Department of Agriculture, which funds the program.

A single person could earn no more than $20,300 income annually to qualify for the program under the "very low-income" criteria, or no more than $32,400 annually to qualify under "low-income" criteria. Annual salary for a family of four could be no more than $28,950 for very low-income status, and no more than $46,300 for low-income status, according to McDonald.

A family or single person meeting those criteria and others would apply to RCHDC for a home loan from the USDA's 502 Direct Loan Program. Those who qualify could repay the loan over a period that could be as long as 33 years. In exchange for not having to come up with a down-payment, the single person or family would supply 65 percent of the labor to build the home. Family members who want to help and community volunteers -- historically with Youth Build -- can pitch in the rest of the work.

The RCHDC provides technical assistance in helping applicants qualify for and close the loan, and the non-profit's construction staff offer technical assistance through the construction process. Applicants can also get help understanding their credit responsibilities and take a course on home ownership.

Since debt is part of the picture in qualifying for a loan, RCHDC staff is also available to help applicants understand what their debt-to-income ratio can be, and how to make adjustments as needed to qualify for the program, according to McDonald.

It can take six months to a year for applicants to secure a loan from the USDA, he said. The whole process sometimes takes upwards of two years, from beginning the application process to completing the home.

The RCHDC has seen an "up-tick" in applications since mid-March, during which time the non-profit has taken 21 applications, according to McDonald.

"Before that, we hadn't seen 21 applications in three months," he said.

The dollars are turning into houses in the Lakewood Subdivision on Lake Mendocino Drive, according to McDonald, where a group of five loan recipients are all working together on their five homes. In the next six to eight months, McDonald said he hopes to have another group of seven start construction on seven more homes in the same subdivision.

The non-profit has helped more than 400 families in Lake, Mendocino and Humboldt counties since its inception in 1975. The first home went up in Willits under the program in 1984, and homes have sprouted since then in the Glass Beach area in Fort Bragg, on Cleveland Lane and Doolin Canyon Drive in Ukiah, and other areas.

Those interested in applying may call RCHDC at 463-1975 and speak with either of two home ownership counselors. Charles Brady can be reached at extension 123, or Ana Rozo, who speaks Spanish, can be reached at extension 124.

Tiffany Revelle can be reached at udjtr@ukiahdj.com, on Twitter @TiffanyRevelle or at 468-3523.